2 Jun 2020

Rental market demand soars as Covid-19 forces NZers home

3:54 pm on 2 June 2020

Covid-19 adds further pressure to some cities already struggling with squeezed rental property markets, as the number of vulnerable people unable to afford housing also rises.

17310827 - new plymouth - major city of the taranaki region on the west coast of the north island of new zealand

Photo: 123RF

New Plymouth is experiencing unprecedented demand from prospective tenants.

In Whanganui, people wanting to return home and out of town interest are pushing the vulnerable to the margins.

At one recent property viewing in New Plymouth there were 53 applicants to view a bog-standard three-bedroom home with a double garage.

Bayleys' property manager Kellie Hodson said while that surprised agents, it was an indication of what was happening in the market.

"There's a lot demand out there at the moment. There's a lot of Kiwi families returning home due to Covid.

"I think they've had a bit of a scare with Covid and they just feel safer returning home and living in New Zealand, New Plymouth."

Hodson said not all of them could find homes however.

"No, that is a problem. There isn't enough houses to house everybody, so there is quite a shortage."

Hodson only had about half a dozen listings and on average she expected to have 20 to 30 applications to view each of them.

On the flipside, she said, employment casualties of Covid-19 were beginning to surrender tenancies.

"Of course, people lose their jobs, so I've had four lots of tenants break their lease because they can't afford to stay in the property.

"Covid hasn't really improved the situation. I mean, before lockdown we did have a major issue with so many people in emergency housing and a couple sleeping in cars and things too, but you can't house everyone, eh? You do your best."

Hodson said some of those returning to Aotearoa wanted to move back into their properties in Taranaki, putting pressure on tenants to eventually move out.

Community Housing Action Taranaki helps those struggling to find a home in the region and its chair Brian Eriksen said two of the trust's temporary stay houses - usually used for about six weeks while a family transitioned into private or state accommodation - were now being used for months.

"We've got people who've been in there for a long time. There's just nowhere for them to go.

"We've got people wanting accommodation and they've got their families split up.

"We've got people sleeping in sheds or doubling up in their mum's place, in a little unit, with their family because they just can't find affordable housing."

Trademe Property had 104 rental listings for New Plymouth yesterday. In Whanganui, there were 44.

Melissa Robinson is the boss of Ray White's Whanganui property management group.

She said locals seemed to be staying put.

"We've actually noticed there's quite an increase in applications we are receiving on properties and the supply doesn't seem to be as high.

"So normally we've got quite a high turnover in Whanganui. You know, properties are coming up for rent quite often.

"That seems to have slowed down. People don't seem to be moving as much."

Robinson said there was a lot of out of town demand.

"I think the biggest change we've seen is people trying to move back to Whanganui. That's actually really surprised me.

"And for whatever reason that might be we've seen a consistent theme of 'we want to be closer to family'.

"We haven't really had too much of the 'hey, I've been made redundant' yet. That hasn't really affected us. It's just the out of towners wanting to come back to Whanganui."

Robinson said she only had about four listings, for which she expected at least 15 applications to view each.

John Coffey, who manages transitional housing for the Salvation Army in Whanganui, said viewing homes was a challenging experience for his clients.

"It's not uncommon to go and have 40 people viewing on a day. It is making it difficult, I have to say that.

"The six families that we currently have in our housing units have been there on average 14 weeks, so it is extending that time out a little bit, but we are still managing to place them."

Coffey said the real issue was the dire shortage of long-term social housing in the city.

According to the Ministry of Social Development website, at the end of March there were 181 people waiting on the Housing Register in Whanganui.

The city has 579 Kāinga Ora properties, of which six were vacant and undergoing repair or maintenance.

At the end of March, New Plymouth had 179 people on the Housing Register.

It has 962 Kāinga Ora properties, 13 of which were under repair.

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